When you work with a financial advisor, you probably expect conversations about investments, retirement, taxes, estate planning, and your long-term financial goals. But there is another question your advisor may ask that is just as important:
“Who should we contact if we become concerned about your well-being or notice something unusual?”
That person is known as a trusted contact.
Naming a trusted contact can provide an additional layer of protection and support, particularly during unexpected situations. Yet many people hesitate because they misunderstand what a trusted contact is—and what authority that person does or does not have.
What Is a Trusted Contact?
A trusted contact is someone you authorize your financial advisor or financial institution to contact in certain situations involving your account or personal well-being.
Depending on the circumstances and the policies that apply, your advisor or firm may reach out to that person if they have difficulty contacting you, become concerned that you may be experiencing financial exploitation, or notice unusual circumstances that raise questions about your safety or well-being.
The trusted contact could be a spouse, adult child, family member, close friend, attorney, or another person you trust.
The most important consideration is simple: Choose someone responsible, trustworthy, and likely to be available if they are ever needed.
What a Trusted Contact Is Not
One of the biggest misconceptions is that naming a trusted contact gives that person access to your money.
In general, a trusted contact is not automatically authorized to trade in your account, withdraw money, make investment decisions, or change account ownership or beneficiaries.
A trusted contact also does not replace a power of attorney, executor, trustee, or other legal authorization.
Think of a trusted contact as an additional point of communication—not someone who automatically takes control of your finances.
Why Financial Advisors Encourage Clients to Name One
Life does not always go according to plan.
There may be a time when your advisor has difficulty reaching you. Perhaps you are traveling, hospitalized, experiencing an emergency, or simply unable to respond for an extended period.
There may also be situations where something unusual happens with your account. For example, your advisor might become concerned about a sudden change in your financial behavior, a possible scam, or the possibility that someone is attempting to take advantage of you.
Having a trusted contact on file can give your advisor another person to reach out to when appropriate.
That conversation could help confirm that you are safe, provide updated contact information, or alert someone close to you that there may be a situation requiring attention.
Choosing the Right Person
Selecting a trusted contact deserves some thought.
The right person should generally be someone who:
Knows you well.
Is responsible and dependable.
Is likely to answer the phone or respond to messages.
Understands that their role is primarily to serve as a point of contact.
Has your best interests at heart.
Is comfortable communicating with your financial advisor or financial institution if necessary.
For many people, a spouse or adult child may be the obvious choice. For others, a sibling, close friend, attorney, or another trusted individual may be a better fit.
It is also a good idea to speak with the person before naming them. Let them know that you have listed them as a trusted contact and explain what that role may involve.
A Small Step That Can Make a Meaningful Difference
Financial fraud and scams have become increasingly sophisticated. At the same time, unexpected health events, travel, communication problems, and family emergencies can make it difficult for financial professionals to reach a client when questions arise.
A trusted contact can provide an additional layer of communication during those moments.
Of course, naming a trusted contact does not guarantee that fraud or financial exploitation can be prevented. It is simply one more safeguard that can help create a connection when something does not seem right.
Review Your Information Regularly
Like other important parts of your financial plan, your trusted contact information should be reviewed periodically.
Relationships and circumstances change. A person you named several years ago may no longer be the best choice today. They may have moved, changed phone numbers, experienced health issues, or simply become less involved in your life.
Consider reviewing your trusted contact whenever you experience a major life change, such as:
Marriage or divorce
The death of a spouse, family member, or previously named contact
A move
Changes in family relationships
Changes in your estate plan
Changes in your health or support network
Keeping this information current can help ensure that your advisor has an appropriate person to contact if a situation arises.
The Bottom Line
Naming a trusted contact is a simple step, but it can play an important role in protecting your financial well-being.
It does not mean giving someone control over your money. Instead, it gives your financial advisor or financial institution an additional person they may be able to contact if they are concerned about your safety, are unable to reach you, or believe something unusual may be happening.
If you have not yet named a trusted contact—or if it has been years since you reviewed the person listed—consider discussing it with your financial advisor.
Sometimes, an extra line of communication can make all the difference.